ATHENS--Prime Minister George Papandreou has proposed forming a national unity government with Greece's opposition political parties in an effort to build a consensus for austerity measures and other economic reforms, a senior Socialist party official said Wednesday.

In a series of telephone conversations with the heads of Greece's four opposition parties earlier in the day, Mr. Papandreou said he was willing to consider stepping down if that would open the door to a much-sought consensus.

"The prime minister has proposed to the other party leaders a national unity government," the official said. "And if there is agreement he is considering stepping down as prime minister."

The official said a prerequisite is that parliament approves a new set of austerity measures at the end of June, which are seen as a precondition for Greece to receive the next disbursement of its 110 billion bailout.

Greece is also seeking at least 60 billion in fresh aid from the European Union and International Monetary Fund. Further austerity measures are also seen as a requirement for any new aid.

The negotiations came as Greek police fought running street battles with dozens of self-styled anarchist youths in the center of Athens Wednesday, as a mass protest over new government austerity measures descended into violence.

In separate incidents near the city's main Syntagma square, the hooded anarchists hurled rocks, chairs, bottles and firebombs at police, who responded by firing dozens of rounds of tear gas and stun grenades.

The official said a prerequisite is that parliament approves a new set of austerity measures at the end of June, which are seen as a precondition for Greece to receive the next disbursement of its 110 billion bailout.